Today's Economic Data Highlights
The Mortgage Bankers Association’s index of mortgage applications is reported to have risen 2.1% in the week ended November 19. At this writing, we have no further details. Market wise, there will be no POMO today.
8:30: Personal income and outlays for Oct....how is spending tracking into Q4? This is the big question for this release, and it will be determined not only by the spending figure for October but by the monthly pattern of the markup revealed in yesterday’s revision to third-quarter GDP growth. Meanwhile, we expect a solid gain in personal income, paced by wages and salaries, and a slight decline in the core price index for personal consumption expenditures.
On income….median forecast (of 74): +0.4%, ranging from +0.1% to +0.6%; last -0.1%.
On spending, median forecast (of 76): 0.5%, ranging from +0.2% to +0.8%; last +0.2%.
On PCE core price index: median forecast (of 52): flat, ranging from -0.0% to +0.2%; last +0.02%.
8:30: Durable goods orders for Oct…how are capital goods shipments tracking into Q4? Analysts are divided over whether bookings for durable goods rose or fell in October—we think they rose about 1%. In this report, the shipments for capital goods are worth a look to see how they are tracking into the fourth quarter.
Median forecast (of 74): +0.1%, ranging from -2.7% to +4.5%; last +3.3%.
8:30: Unemployment insurance claims….more improvement? Slowly but surely (more slowly than surely), initial claims for unemployment insurance are edging down, bringing the four-week moving average to its lowest level in more than two years. Analysts look for that trend to continue in this week’s report, which is again being issued a day early. It’s hard to imagine that the median estimate for new and continuing claims will be as close this week as they were last week (2k off and spot on, respectively).
For initial claims, median forecast (of 46): 435k, ranging from 420k to 450k; last 439k.
For continuing claims, median forecast (of 14): 4.275 million, ranging from 4.21mm to 4.32mm; last 4.295mm.
10:00 (9:55 to subscribers): Reuters/University of Michigan consumer sentiment for Nov (final)…slight uptick? The median forecast for this index is essentially on top of the preliminary reading, which is often how the final reading turns out. The median expectation for inflation five to ten years ahead was 2.8% in the preliminary report, the same as in October.
Median forecast (of 64): 69.5, ranging from 68.4 to 71; last 69.3 (Nov prelim).
10:00: New home sales for Oct...a small increase? Sales of new homes have been fluctuating in an extremely low and relatively narrow range (282k-310k) since the homebuyer tax credit expired at the end of April. We expect only a small increase from 307k given that the large overhang of unoccupied existing homes is probably sapping most of the net demand created by first-time buyers.
Median forecast (of 72): +1.6%, ranging from -3.9% to +9.8%; last +6.6%.
10:00: FHFA housing price index for Sep…another decline? This index rose in August, but the trend has been gradually down since early 2008 (before which it was down more sharply). Forecasts show no clear direction for September.
Median forecast (of 15): flat, ranging from -0.5% to +0.6%; last +0.4%.
11:00: No POMO today.... One of those rare days in which Brian Sack does not tell Goldman to buy Netflix and Amazon
Compilation by GS and ZH